Money Back Policy

Money-back plans offer guaranteed returns on investments, which are fixed at the time of policy purchase. For risk-averse investors, the returns are stable, providing a steady income free from market uncertainties. The predictable income at regular intervals helps to plan confidently for key events in life.

Additional bonuses are added to the policy annually, which is paid out on maturity or death. These bonuses are a valuable addition to the savings corpus. Reversionary bonuses are declared annually and performance-based. They reward the policyholder when the company performs well. These bonuses accumulate over time and help grow wealth over time. Terminal bonus is discretionary and is paid out on maturity or death.

The policyholder can claim tax benefits under Section 80C and Section 10(10D) of the Income Tax Act, 1961² for the premiums paid and the death/maturity benefit, respectively, which will considerably reduce the overall tax liability, enhance the return on investment, and boost net savings.

Family members undergo an emotional and financial crisis when one of the members leaves this world. However, a money-back plan secures them financially and gives the policyholders’ peace of mind that they are protected during such a crisis.

Money-back plans are curated to plan for specific goals such as education, marriage, retirement, etc. The structured payouts given out as a survival benefit allow access to funds when in need. This approach supports savings while providing life cover throughout the policy term.

Besides providing regular payouts, the money-back plan secures your family financially in your absence. You can rest assured that your loved ones will not face a financial crisis when you are not around to provide for them. The death benefit helps them manage their expenses and remain financially stable and independent.

The survival benefit at regular intervals helps manage immediate or short-term expenses, such as school fees, medical needs, a dream vacation, etc. The disciplined savings habit is rewarded with the remaining sum assured along with on with accumulated bonuses if the policyholder outlives the policy term, which helps meet long-term financial goals.

The regular payouts during the policy term enhance the liquidity of the investment. They serve as a parallel income stream to manage expenses for life events, such as home renovation, travel plans, school fees, etc. It provides financial flexibility while inculcating a long-term savings habit.

Money back policies involve a lower degree of risk as they are not market-linked investments. Unlike stocks, bonds or mutual funds, money back plans are able to provide guaranteed returns at regular intervals during the policy’s term, such as monthly or annually. 

The age of the individual should be a minimum of 18 years and a maximum age of 55 to 65 years. Usually, the age bracket varies from insurer to insurer.

The individual should also have a stable income flow and must be capable of paying the insurance premium on time.

The policy term can be anywhere from 10 years to 25 years, but it cannot go beyond the maximum permitted age.

It allows the policyholder the facility to waive off their premium payment under several circumstances.

In case of an accidental death of a policyholder, this rider provides a death benefit to the policyholder's beneficiaries.

This rider enables the policyholder with assured cash if he or she is diagnosed with a terminal illness such as heart attack, stroke, kidney failure etc.

It provides the policyholder financial assistance when he or she is hospitalised and provides cover for eligible treatments.

If the Life Assured, or if more than one Life Assured the first to become critically ill of the Lives Assured, becomes critically ill by suffering one of the illnesses defined , a sum as specified in the Policy Schedule shall be payable.

A critical illness rider financially empowers you to get the best possible treatment without worrying about costs, in case the Life Assured is diagnosed with a Critical Illness.

The first and foremost thing to consider is your financial goals. This can include goals like buying a house, planning an expensive vacation, funding children's education, etc. Based on your medium and long-term financial goals, you can choose the most appropriate plan.

Based on certain factors like the standard of living of your family, living expenses, your contribution to the total family income, etc., you should determine the sum assured amount. This amount has to be enough to cover your family’s immediate and long-term needs.

It is important to read the terms and conditions of a money back policy before finalising the same. There can be various exclusions in the policy which are not displayed at the forefront while advertising. It is best to read through all the terms and conditions to know the consequences of various situations you may face.

It is also another crucial factor to consider and you must choose the amount of premium in such a way that it does not feel like a financial burden to you.

Some of your insurance requirements may not be covered in the base policy such as critical illness coverage, accidental death cover, etc. Therefore, choose riders wisely over the base policy based on your financial needs and affordability.

Consider checking the claim settlement ratio of the insurance company. It is a figure denoted in percentage which reflects how many claims it has settled out of 100. Hence, the higher it is the more the chances for the policyholder that the claim will be settled.

Make sure that you understand all the features of the policy properly. In case you find any difficulties, you can reach out to our insurance advisors by requesting a call back from our website. They will explain to you the details and resolve your queries.

You must choose the amount of premium in such a way that it does not feel like a financial burden. Also, many insurers offer the flexibility of multiple premium payment options like monthly, quarterly, semi-annually or annually. Make sure to pick a plan that provides the best value for your premium.

After finalising the sum assured and choosing the premium amount, determine the returns you will receive as money back. You can reach out to our advisors by requesting a call back from our website.  Knowing these beforehand can help you make an informed decision.

It is always recommended to check for the exclusions of a policy as some companies do not explain such things upfront while promoting their insurance products. There can be several exclusions in the base policy but you can opt for a rider to get additional benefits.

It is extremely important to consider your financial goals and objectives before availing of a money back policy. Identify the objective and choose the policy based on it.

It is an amount which is paid to the family member or beneficiaries of the policyholder in the event of the unfortunate demise of the policyholder. Hence, it is one of the crucial aspects to consider when choosing a money back plan.

There can be some additional benefits like bonuses and other perks which makes it a lucrative deal for the policyholder. Hence consider what riders you are allowed to add to your base policy.